SPACs: Is it now just a fleeting trend or still worth your money?

SPACs: Is it now just a fleeting trend or still worth your money?

Dubai: Since 2021 began, there were several mentions of the word ‘SPAC’ in the world of business and investments. But since the start of this year, there haven’t been much talk on this so-called boom. Did this up and coming trend fizzle out? Although SPACs were first created in the 1990s, they didn’t gain popularity with investors until last year. There were 302 SPAC deals throughout 2021 worldwide with $622.9 billion (Dh2.29 trillion) invested, a year-on-year surge of over 152 per cent. The SPAC boom witnessed last year in the US fizzled out in 2022, dropping from $231.3 billion (Dh849 billion) in 2021, to $26.3 billion (Dh96.60 billion) so far this year. Similar trends were witnessed elsewhere in the world. Only one SPAC was launched in Hong Kong in the first quarter and it raised $128 million (Dh470 million), while three were launched in Singapore, raising a total of $334 million (Dh1.2 billion), according to global data analytics firm Refinitiv. “Although the investments still trickle in for SPACs, it’s only likely reflective of investors being happy to play a game of patience, rather than investors who in recent years chased SPACs higher in the hope they would acquire a ‘hot’